Railroad Commission Proration Remarks: Stop Sending Texas Gas Up in Smoke

As the Texas Railroad Commission debates proration – limiting oil production in response to crashing demand – the agency overseeing the state’s oil and gas industry also has an opportunity to stem the profligate practice known as flaring. EDF’s Scott Anderson testified at the Railroad Commission’s proration hearing today.

Often described as way to raise prices by limiting supply, authority for proration actually comes from the commission’s statutory obligation to prevent the waste of natural resources and protect property rights. Since 2013, operators in Texas have wasted enough natural gas through flaring to meet the yearly needs of every Texas home three times over.

In addition, royalty and mineral owners – a list that includes 600,000 Texas households – often lose out to excess flaring. That’s because most of the state’s oil and gas producers lease their mineral rights, and many of these owners don’t get paid for gas that’s flared before it gets to market.

“The commission has a chance here to save the state’s oil and gas industry from one of its worst habits – setting fire to more than 100 billion cubic feet of natural gas each year, turning a valuable asset into waste and pollution. Last year operators in the Permian alone sent over a million dollars a day worth of Texas gas up in smoke.

“Using a flaring metric in the proration process would provide a valuable incentive for producers to operate more efficiently and with less pollution and provide fair reward to those that already do. Conversely, proration without a flaring metric provides absolutely no guarantee that flaring will fall simply because production does.”

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